* Industry has warned of undue burden
* Canada has led campaign against the carbon ranking
* Report says much of the work already being done
By Barbara Lewis
HORSENS, Denmark, April 19 Proposed EU law
requiring fuel suppliers to report the carbon intensity of their
product, and which also rank oil from tar sands as particularly
polluting, would only cost vehicle drivers around one euro cent
per oil barrel, a report said on Thursday.
EU member countries are already required to report extensive
fuel data, meaning the proposed laws would not require much
extra effort, the report by consultancies CE Delft, Carbon
Matters and Energy Research Centre of the Netherlands found.
The report, based on an analysis of current EU reporting
requirements and interviews with oil industry representatives,
counters industry arguments the European Union proposal would
pose an undue administrative burden.
Fuel suppliers can report the greenhouse gas intensity of
their fuel for 0.8-1.6 euro cents per barrel, the report
While the short-term price impact of the proposals should be
limited, it could impact longer-term investment decisions as the
world becomes more dependent on unconventional oil, which is
more difficult and energy-intensive to extract.
"It can prevent the greenhouse gas emissions of fossil fuels
increasing in the future, due to an increasing share of
unconventional oil, and it will make suppliers responsible for
these emissions," the report said.
Curbing emission is the goal of environmental campaigners,
who are urging the Commission, the EU's executive arm, to press
ahead with implementation of its Fuel Quality Directive.
"This independent study shows that most of the reporting
needed for this legislation is already being done and the
administrative costs would be absolutely negligible," said Nusa
Urbancic, programme manager at green transport group T&E.
"It's in the EU's and the industry's interests to see that
high carbon oil has no future, if we are serious about reducing
FUEL QUALITY DIRECTIVE
The Fuel Quality Directive, approved by the EU in 2009, sets
a target for oil companies to reduce greenhouse gas emissions
from transport fuel by 6 percent by 2020 as part of a wider set
of green goals.
In October 2011, the European Commission proposed detailed
rules for implementing the targets, which include reporting
requirements and so-called default values for the carbon
emissions of different sources of fossil fuels.
High carbon sources get higher carbon values, prompting
Canada, a major producer of tar sands oil, to campaign
energetically against the EU plans.
A February meeting of technical experts from the 27 EU
member states failed to agree on the new rules after Canada's
lobbying, which was backed by EU nations with firms active in
oil sands, including Britain and the Netherlands. The Commission
is reviewing the next steps.
The European Petroleum Industry Association (EUROPIA) is
among those to argue the administrative burden could jeopardise
security of supply and possibly lead to the closure of European
The industry body said that even if the extra cost was just
$1 per barrel, some refineries would lose economic value. It
proposed using an average greenhouse gas value for all crudes as
a better solution.